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UK inflation slows to 2.3% in March, misses forecasts

UK inflation slows to 2.3% in March, misses forecasts

Mubasher: The UK’s consumer price index (CPI), the measure of inflation, showed a decline last month to 2.3%, its lowest level since March 2017, having reached a high of 2.8% at the end of 2017.

Inflation is also down from 2.5% in February, data released by the Office for National Statistics (ONS) showed on Wednesday.

The CPI’s 12-month rate registered 2.5% in March, falling from 2.7% the month before, according to the data.

The data comes lower than analysts’ forecasts as economists polled by The Wall Street Journal (WSJ) had projected that annual inflation would remain stable at 2.5% in March.

The “largest downward contribution” in the inflation rate was primarily brought about by the rise in clothing and footwear prices at a rate comparatively lower than that registered a year ago, the ONS said.

Similarly, “price movements for alcoholic drinks and tobacco also made a downward contribution to the change in the rate,” the report showed, indicating that this decline reflects changes to the Budget cycle introduced in 2017.

Tax changes for tobacco were introduced in November 2017 instead of March 2018.

By 9:22 am GMT, the GBP/USD pair fell 0.78% to $1.4177.